Telecom Italia (NYSE: TI) is seeking the help of Morgan Stanley on finding the best method to spin off its wireline network in an effort to raise more capital for the company and fund its FTTx projects.

Citing a person close to the situation, Bloomberg reports that Morgan Stanley is talking with Italy's state-run Cassa Depositi e Prestiti (CDP) SpA, which could buy a piece of the network.

Even though a potential wireline network spinoff would enable it to turn more of its attention to building out more profitable wireless data services, TI isn't turning its back on wireline broadband, building out FTTH and Fiber to the Cabinet (FTTC) networks.

Interestingly, TI's wireline broadband investments come at a time when Italy's parliament passed legislation known as Growth 2.0 to implement the EU's Digital Agenda. Part of this bill includes €750 million ($988 million) to expand broadband access in underserved areas.

Regardless of the progress TI has made in rolling out FTTC and FTTH services, it still trails other countries such as Lithuania and Norway, which according to the FTTH Council Europe have reached over 30 and 18 percent penetration, respectively, with FTTH.

For more:
- Bloomberg has this article
- Telecompaper has this article